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Supporting the HR capability of the future – Principle based HR, by Ksenia Zheltoukhova

If HR is to remain current as we continue into the 21st Century, its capabilities have to adapt as business, technology and globalisation develop faster than they have at any other period in history. To shed light on this, CIPD Researcher Advisor and guest of The HR World Ksenia Zheltoukhova has explored how the CIPD will support the development of HR capabilities in the future.

As a professional body for HR and people development, the goal of the CIPD is to support the profession in championing better work and working lives. By this we mean finding the sweet spot between the construct of work itself and people’s experience at work, and delivering people management systems and practices that create value for employees, businesses, economies and societies.

We are continuously advancing HR knowledge in the areas of work, workforce and workplace to evolve the standard of ‘good’ people management. But, as the world of work is evolving fast and is growing more diverse, keeping this body of knowledge relevant is challenging. There is no longer a single ‘golden rule’ or ‘best practice’ that would enable HR professionals to operate effectively in all the different business and international contexts today, let alone in five, ten or twenty years’ time. ‘Good’ HR is increasingly context-specific, and requires situational judgment informed by the latest evidence, to find solutions appropriate for the particular business priorities, the nature of the workforce and organisational culture.

This is why we think good HR should be defined in terms of broader principles. In contrast with a ‘rules-based’ approach to standards, which defines specific practices, the principles-based approach – already adopted by many other professions – focuses on professional judgement, describing the fundamental obligations we should take into account when deciding how to act in practice. Often these obligations involve weighing the interests of various stakeholders, and deciding on the ultimate goals a professional is pursuing in making a decision. For example, one of the global management accounting principles highlights the need for stewardship with the purpose of protecting organisations’ financial and non-financial assets, reputation and value.

The diversity of contexts that HR professionals will face in the future requires them to develop a similar degree of sensitivity to the impact that people management decisions have on organisational sustainability. Often, the challenges will precede appropriate regulation, or will have to be made in the absence of reliable evidence that would indicate a definite way forward. Instead, HR professionals will have to consider their fundamental professional values to tackle complex questions of reconciling market forces with fairness, eliminate trade-offs between the short-term and long-term horizons, and support the interdependencies between the business and the local communities that it’s tapping.

The need for credible professionals who can foster productive relationships between various stakeholders is becoming more evident every day. Businesses increasingly recognise that effective human capital management is critical to their competitive advantage, and they rely on practitioners who can deeply understand the business context to get the most out of the workforce. They are looking for more than a qualification when recruiting HR practitioners; they’re looking for a bridge between HR and business and bespoke and creative insight that supports long-term organisational health.

We believe that a principles-based approach to professional standards is key to ensuring that HR can balance its competing stakeholder interests to find win-win solutions for everyone; ultimately this will shape the evolution of the HR profession in two ways; firstly, it will highlight HR’s unique role in creating shared value through the sustainable treatment of people. Secondly, the principles will provide a guiding framework for making professional judgements in the context of high uncertainty, thus fostering the development of a professional body of knowledge and a standard of ‘good’ practice that transcends time, cultures, geographies and legal boundaries. The result will be to build trust and credibility in HR, and to put an end to debates about its relevance and value, so that it becomes a recognised profession like medicine or accountancy.